C&C buys US cider company
Drinks group C&C is to buy Vermont Hard Cider Company for $305 million (€234.15 million), the company said today, as it reported first-half profit that missed estimates.
Operating profit, excluding some items, slid 2.7 per cent to €65.6 million, the Dublin-based company said today in a statement.
That compares with the average estimate of 4 analysts for €67 million.
First-half net revenue fell 2 per cent and volume of branded products declined 8.2 per cent.
Annual operating profit will be "at the lower end" of forecasts, the company said today.
C&C, which said it had shown a "resilient performance in tough markets," is buying Vermont Hard Cider to add leading US cider brand Woodchuck.
It's offsetting tough markets in its largest markets of the UK and Ireland with growth from regions including the US, where it bought Hornsby's cider last year.
The beverage company is suffering from "deflation in Ireland, a slowing and more competitive Great Britain cider category and lack of good summer weather this year," Barry Gallagher, an analyst at Davy in Dublin, wrote in a note before the results.
"Its beer business continues to have good opportunity for top-line and profit growth, and the potential for growth in cider outside of traditional markets is significant."
The company forecast in June full-year operating profit, excluding some items, of €112 million to €118 million, and said today results would be at the lower end of targets.